The Future of Voice and Regulatory Implications

The future of voice and regulatory implications

WIK Conference - New Code, new challenges for the Gigabit society

Dr René Arnold 15. October 2019 The future of voice and regulatory implications

WIK Conference - New Code, new challenges for the Gigabit society

Dr René Arnold 15. October 2019 Colourful communication

Usage of communication services in Germany according to age groups

Landline or mobile telephony Email WhatsApp SMS Facebook Messenger Skype Instagram Twitter Snapchat iMessage

Source: Own presentation; data from the WIK online survey from the year 2018 with N=2044. Respondents were asked about their usage of landline telephony, mobile telephony, SMS and email as well as 22 additional OTT-1 services. The Services nit shown are Telegram, Facetime, Threema, Viber, Hangouts, Tinder, Kik Messenger, WeChat, Lovoo, LINE, Signal, Google Duo, Google Allo, Blackberry Messenger und Kakaotalk. .

Consumers use

communications services on average

• separation of different social ties is a driver of multi-homing

• innovation in functions pushes competition

• communication functionality features also in other services

WIK survey in July 2018 N=2044 Is traditional services‘ time up? 85 84 77 79

22 19 13 13 1 2 2 3

2015 2016 2017 2018

Consumers (18+) in Germany who use… ECS only ECS & OTT OTT only

30 26 25 25

20 21 20 15 17 17

WIK annual monitoring of communication behavior in Germany: N=1027 (2015); N=1003 (2016); N=2036 (2017); N=3184 (2018) See also: Arnold, R., & Schneider, A. (2019). Got the message? Communication behaviour in Germany. Bad Honnef, Cologne: WIK, Hochschule Fresenius. Conversational Commerce Application-to-Person (A2P) Messaging Companies no matter their size should be available for their customers via messaging TAN authentification, boarding passes A long and services. Many requests can be handled by and direct marketing are only a few chatbots more efficiently than by human agents. examples for messages for which winding road This opens a potential revenue stream for OTT companies have a high willingness to actors who provide these chatbots as a service. pay to engage directly with to monetisation consumers. Currently, the majority of these messages are sent via SMS. But WhatsApp, Viber and other OTT services are starting to gain a foothold Snapchat in the A2P messaging market whose size is estimated at US$11.9 billion Shoppable reality – simply taking a globally.1 picture of a pair of trousers and purchasing them directly online. Snapchat enables this in collaboration with Amazon. They receive a share of the revenue from the purchase for their intermediation. The function is so far only available in the US. Besides additional revenue, these “snaps” generate relevant insights into consumers via the metadata collected around the purchase. Ultimately, these data can help to train other algorithms, which in turn may enable new innovative functions.

1 https://www.tatacommunications.com/wp-content/uploads/2017/06/an-A2P-messaging-monetisation-study.pdf OK, Google call Alexa

voice assistants' functions utilised by their users in %

Source: Survey n=816. *Cortana: 59%; Bixby 8%; Google Assistant 43%; Siri 24%; Alexa 13%.

The future of voice may be the future of commerce

21% mentioned a product and Alexa ordered it directly.

of %

49 21% mentioned a product and had Alexa read out those the list of results until they arrived at the of Alexa users have specific product they were looking for.

purchased something online via Alexa. 30% knew exactly what they wanted and asked for a very specific product that they ordered via Alexa.

Source: Survey n=816. *Cortana: 59%; Bixby 8%; Google Assistant 43%; Siri 24%; Alexa 13%.

Why should we care?

Taş, Serpil, Christian Hildebrandt, & René Arnold. 2019. Sprachassistenten in Deutschland - WIK-Diskussionsbeitrag Nr. 441. Bad Honnef: Wissenschaftliches Institut für Infrastruktur und Kommunikationsdienste. Why should we care?

“interpersonal communications service’ means a service normally provided for remuneration that enables direct interpersonal and interactive exchange of information via electronic communications networks between a finite number of persons, whereby the persons initiating or participating in the communication determine its recipient(s) and does not include services which enable interpersonal and interactive communication merely as a minor ancillary feature that is intrinsically linked to another service.” (Art. 2 (4) EECC)

Taş, Serpil, & René Arnold. 2019. Die Auswirkungen von OTT-1 Diensten - WIK-Diskussionsbeitrag Nr. 440. Bad Honnef: WIK. Who is in and who is not?

• The line between NI-ICS and social networks is difficult to establish.

• Notably, Art. 2 does not preclude parts of social networks being NI-ICS.

• Intended function does not necessarily match actual consumer behaviour

Taş, Serpil, & René Arnold. 2019. Die Auswirkungen von OTT-1 Diensten - WIK-Diskussionsbeitrag Nr. 440. Bad Honnef: WIK. Who is in and who is not?

• Voice assistants, instant translation and chatbots may blur the concept of interpersonal communication.

• What constitutes “interpersonal communication” anyway?

Taş, Serpil, & René Arnold. 2019. Die Auswirkungen von OTT-1 Diensten - WIK-Diskussionsbeitrag Nr. 440. Bad Honnef: WIK. Who is in and who is not?

• There is no clear, measurable indicator of when the communications function is “ancillary”.

• The video game example may increase ambiguity rather than reduce it.

Taş, Serpil, & René Arnold. 2019. Die Auswirkungen von OTT-1 Diensten - WIK-Diskussionsbeitrag Nr. 440. Bad Honnef: WIK. Potential indicators for „ancillary feature“

• Consumer research – main reasons for using a service

• Average share of time of communications function usage relative to the full time of service usage

• “Unusability” of the communication feature without the main service

• Sequence of functions being added to the service

• Share of users utilising the communications function relative to all users of the main service

Taş, Serpil, & René Arnold. 2019. Die Auswirkungen von OTT-1 Diensten - WIK-Diskussionsbeitrag Nr. 440. Bad Honnef: WIK. Contact Dr. René Arnold Abteilungsleiter – Märkte und Perspektiven Rhöndorfer Str. 68 53604 Bad Honnef

+49 (0)2224 92 25 25 [email protected]

Some of our latest studies on the issue:

Arnold, René, Serpil Tas, Christian Hildebrandt, & Anna Schneider. 2019. "Any Sirious Concerns Yet?–An Empirical Analysis of Voice Assistants’ Impact on Consumer Behavior and Assessment of Emerging Policy Challenges." TPRC47, Washington, DC, 20.-21. September 2019.

Taş, Serpil, & René Arnold. 2019. Die Auswirkungen von OTT-1 Diensten - WIK- Diskussionsbeitrag Nr. 440. Bad Honnef: WIK.

Arnold, René, & Anna Schneider. 2019. Got the message? Communication behaviour in Germany. Bad Honnef, Cologne: WIK, Hochschule Fresenius.

Arnold, René, & Anna Schneider. 2019. Canned Intelligence - Voice assistants in Germany. Bad Honnef, Cologne: WIK, Hochschule Fresenius.

Arnold, René, & Anna Schneider. 2017. "The Functionalities of Success: A Psychological Exploration of Mobile Messenger Apps Success." TPRC45, Arlington, VA, 8.-9. September, 2017.

Arnold, René, Christian Hildebrandt, Peter Kroon, & Serpil Taş. 2017. The Economic and Societal Value of Rich Interaction Applications (RIAs). Bad Honnef: Wissenschaftliches Institut für Infrastruktur und Kommunikationsdienste (WIK).